Quanta Computer — a major supplier of components for the Apple Watch — announced a major deal on Monday that would significantly expand the availability of augmented reality glasses by 2019.

The licensing deal is with Lumus, an optics company that makes the core display components for augmented reality glasses. Lumus provides a projector-like technology that overlays images onto the "screen" of a spectacle lens.

Lumus, founded in Israel in 2000, has a long patent history in the augmented reality arena. In particular, the company focuses on embedding multiple prisms into a single piece of glass, to increase the size and breadth of images while keeping the lenses discreet and "non-dorky," CEO Ari Grobman said.

Augmented reality, unlike virtual reality, has to adjust colors and displays for conditions such as fog and sunlight — which, until now, has been a major bottleneck for big manufacturers like Quanta. This deal could pave the way for headsets that are $1,000 or less, Grobman said.

Quanta, which is also known for laptop computers, has already laid out an ambitious plan to move toward augmented reality manufacturing by 2019, something Lumus said it can do. Like top computer brands advertise processing power as "Intel inside," the new glasses could be designed to the specifications of top brands with Lumus inside.

Apple CEO Tim Cook has swatted down rumors that the company is working on an augmented reality headset, saying that he didn't think the technology existed to bring AR glasses up to Apple's standards "any time soon. "